Insurer for Lloyd’s, Reinsurer Brit have reported a profit of £6.4 million in the first half of 2011; a whopping fall of 90.5% over the £67.4 million it reported during the same period last year.
Higher claims combined with lower premium income were attributed to the abysmal results. The situation was further exacerbated by the lack of a £33.4 million foreign exchange gain reported last year.
The combined ratio for Brit jumped to 104.8 per cent in H1 2011 from 96.5 per cent over the same period last year. Natural catastrophes had a huge impact and were estimated at £94.5 million, compared to £44 million in 2010, adding 15.5 percentage points to the combined ratio.
However, the losses were offset by the reserve release of £43.1 million from previous years, compared to the reserve release of £41.9 million in 2010.
Gross premium written during the period fell by a marginal 0.7 per cent to £845.3 million from £851.5 million last year. The company attributed this to a disciplined approach to renewal and new business, and active management of portfolios.
Despite the numerous catastrophes hat hit the first half of 2011, the company managed to report profits for the year, said chief executive Dane Douetil, praising Brit’s performance.
“The underlying performance of Brit Insurance continues to strengthen. The continued improvement in the underlying claims ratio has been particularly encouraging at a time of difficult pricing conditions and is the result of our total focus on underwriting performance across the business. This is reflected in the company producing a profitable result despite the unprecedented number of catastrophe events in the first six months,” Douetil said in a statement.
Fellow Lloyd’s insurer Beazley reported an after-tax loss of £8.6 million in the first half of 2011 because of high claims from catastrophes.